Federal Update: Renewable Fuels Standards, Appropriations Bill

Ohio grain farmers are not happy with the U.S. EPA’s recent proposal to reduce the amount of renewable fuel, including ethanol, that must be blended into the nation’s gasoline supply, also known as the Renewable Fuel Standard (RFS). Ohio Farm Bureau has significant concerns with this proposal which stands to decrease demand for Ohio’s agricultural products, harm our rural economy and negatively impact the positive strides made in using cleaner energy. Here are a few main points from the comments Ohio Farm Bureau submitted to EPA on behalf of members:

The production of soybeans and corn is a significant contributor to Ohio’s economy and the placement of agriculture as the No. 1 industry in Ohio. While renewable fuels have not been the sole driver in demand for these agricultural products, they have played a significant role.

Ohio’s corn farmers, who are already seeing a significant decrease in price, will likely witness an even weaker market if the Renewable Fuel Standard level for conventional biofuels is lowered to the level recommended in this proposal.

Farmers have made land purchases and planting decisions in a market that includes the RFS targets. To lower the blending requirements from their projected levels means that operators will be hard pressed to change their farm operation decisions in time to adjust for the lost demand.

The ripple effect on agribusiness, processors and our communities must also be considered. Ohio is currently the home to seven biorefineries that on average have 45 employees each. These positions represent a significant boost to Ohio’s rural economy with more than $11 million in annual payroll.

Since the standard has been in place, the United States has seen its crude oil imports decrease from 60 percent of total oil use to around 40 percent. While this decrease is impressive, there is still room and need for even greater domestic production to protect consumers from swings in oil prices which are set on world markets.

Our nation is moving in a positive direction in decreasing emissions through the use of ethanol. This proposal endangers the positive strides made in decreasing harmful gases into the atmosphere.

Appropriations bill includes funding for USDA, FDA

The House passed an Omnibus Appropriations bill for Fiscal Year 2014. The omnibus bill includes $1.1 trillion in spending, with the USDA/FDA portion of the bill being $147.5 billion in total spending and $20.9 billion in discretionary spending.

Highlights of the bill that will impact agriculture include:

Country of Origin Labeling language that recommends USDA delay enforcement of the revised country of origin labeling rule until the World Trade Organization makes its decision on the grievances from Mexico and Canada.

Restoring the $85 million FDA user fee funds that were lost in sequestration.

Increase in funding for the Food for Peace program and keeping the program within the jurisdiction of the USDA.

$180 million funding increase for USDA Rural Development.

Language that prevents the implementation of GIPSA regulations. These regulations provide common-sense transparency, disclosure and capital investment protections for poultry farmers in their contract relationship with poultry companies. These regulations are critical to protect poultry farmers.

Language that precludes USDA from spending federal dollars to provide inspection for the processing of horses for human consumption. Prohibiting the harvesting of livestock for reasons unrelated to food safety or animal welfare sets a dangerous precedent for banning meat production from every species, including beef, pork, lamb and poultry. Further, this language represents a serious infringement on the legal property rights of horse owners.